Puerto Rico to cancel $10 billion in bond payments as crisis intensifies
SAN JUAN, Puerto Rico — The island’s government said Tuesday it plans to cancel a $10.4 billion bond payment it has been making to Puerto Rico’s $73 billion-a-year debt to the U.S. government as the island faces a crisis of unprecedented proportions.
Alejandro Garcia Padilla said he would ask Congress to postpone the payments for another year, saying the debt-financed debt could be repaid.
The payments are scheduled to be made in two installments of $50 billion and $90 billion on Oct. 31 and Nov. 1.
Padilla and the island’s lawmakers have been negotiating to reduce the islands debt burden, which is a major source of federal funds.
Padillas administration says the island is still recovering from the hurricane, which devastated the island, killed at least 1,300 people and caused $1.5 trillion in damage.
The Puerto Rico National Guard, which serves as the countrys main military, was forced to evacuate the island due to flooding, which forced some residents to camp out in streets.
The island was left with no power and has had to pay out more than $1 billion to repair its roads and schools.
The debt payments were made in 2015.